The implementation of e-commerce tax, initially slated for February 2026, has been postponed and will now be adjusted according to prevailing economic conditions. This decision raises a critical question: what is the current progress of discussions surrounding Income Tax Article 22 (PPh 22) for online merchants?
According to Budi Primawan, Secretary General of the Indonesian E-commerce Association (idEA), Minister of Finance Purbaya Yudhi Sadewa has verbally confirmed the deferral of the e-commerce tax collection policy. This postponement is a strategic move to safeguard the momentum of national economic growth, which is targeted to reach 6%. “Currently, this policy is still undergoing a joint review with the Directorate General of Taxes (DJP),” Budi informed Katadata.co.id on Friday, January 2.
Despite the delay in implementation, Budi emphasized that the policy discussion process remains active and ongoing, highlighting the government’s commitment to a well-considered approach.
From the industry’s perspective, idEA has affirmed that e-commerce platforms are, in principle, ready to support the upcoming tax policy. This readiness, however, is contingent on the regulations being clear, consistent, and meticulously considering their impact on businesses, particularly Micro, Small, and Medium Enterprises (MSMEs). Budi noted, “Generally, platforms already possess transaction recording systems. Nevertheless, several technical details still require refinement and alignment.”
These crucial technical details primarily refer to provisions within Minister of Finance Regulation (PMK) Number 37 of 2025 and Director General of Taxes Regulation (Perdirjen) Number 15 of 2025. IdEA stresses that synchronizing these regulations is paramount to prevent confusion and ensure a smooth implementation process on the ground.
The regulation Budi referred to is PMK Number 37 of 2025 concerning the Appointment of Other Parties as Tax Collectors, as well as Procedures for Collection, Deposit, and Reporting of Income Tax on Domestic Merchants Transacting Through Electronic Systems. As stipulated in Article 8 Paragraph 1 of PMK 37 of 2025, which came into effect on January 1, “The amount of PPh Article 22 levy is 0.5% of the gross turnover received by domestic merchants, as stated in the billing document, excluding VAT and Luxury Goods Sales Tax.”
The Director General of Taxes at the Ministry of Finance, Bimo Wijayanto, confirmed that the appointment of marketplaces as PPh 22 collectors from online merchants is awaiting further directives from Minister of Finance Purbaya Yudhi Sadewa. “The PMK we designed pertains to appointing marketplaces to collect tax from merchants participating on their platforms. That particular aspect is postponed until further instruction from the Minister,” Bimo stated in October 2025. The Directorate General of Taxes initially planned to defer the appointment of marketplaces as PPh collectors from October 2025 to February 2026. However, Minister Purbaya’s latest directive indicates that PMK 37 of 2025 will be delayed until the national economy achieves a 6% growth rate. “Initially, the directive for us was until February (2026), but then there was a new instruction from the Minister to wait until 6% growth is achieved,” Bimo clarified.
Criteria for Taxable Online Merchants
Former Minister of Finance Sri Mulyani Indrawati previously signed PMK 37/2025, which governs the appointment of marketplaces to collect tax from online merchants. This policy aims to streamline administrative processes, enhance simplicity, and boost the efficiency and effectiveness of tax collection. The criteria for online merchants obligated to pay the 0.5% tax are as follows:
- Domestic Merchants
Article 5 clarifies that domestic merchants include both individuals and business entities selling on e-commerce platforms or marketplaces. These merchants must receive income through bank accounts or similar financial accounts and conduct transactions using an Indonesian Internet Protocol (IP) address or a phone number with an Indonesian country code. The regulation also extends to shipping or expedition service companies, insurance companies, and other parties involved in transactions with buyers of goods and/or services via e-commerce or marketplaces.
- Individual Domestic Merchants with Gross Turnover Exceeding Rp 500 million in the Current Tax Year
For sales below Rp 500 million, sellers are still required to submit their Taxpayer Identification Number (NPWP) or National Identity Number (NIK), correspondence address, and a letter of exemption from income tax withholding and/or collection by the end of the month.
- Domestic Business Entities
E-commerce Tax Rates
Online merchants are required to pay a tax equivalent to 0.5% of their sales. The specifics are detailed below:
| Taxpayer Type | Specific Gross Turnover (Omzet) | Collection Rate | Nature of PPh Collected | Treatment of PPh Collected |
|---|---|---|---|---|
| Individual Taxpayer | Below or up to Rp 500 million | No PPh collected | — | — |
| Between Rp 500 million – Rp 4.8 billion | 0.5% | Final PPh (meeting PP-55/2022 provisions) | Final | |
| Non-final (not meeting PP-55/2022 provisions or opting for general provisions) | Can be used as a tax credit in Annual SPT | |||
| Above Rp 4.8 billion | 0.5% | Non-final | Can be used as a tax credit in Annual SPT | |
| Corporate Taxpayer | Below or up to Rp 4.8 billion | 0.5% | Final PPh (meeting PP-55/2022 provisions) | Final |
| Non-final (not meeting PP-55/2022 provisions or opting for general provisions) | Can be used as a tax credit in Annual SPT | |||
| Above Rp 4.8 billion | 0.5% | Non-final | Can be used as a tax credit in Annual SPT |
When the PPh is classified as final, taxpayers are not required to recalculate this collected tax in their Annual Tax Return (SPT Tahunan). However, this specific levy cannot be credited against or deducted from other taxes. Conversely, if the PPh is deemed non-final, taxpayers must calculate their income minus expenses, which will then be subject to progressive tax rates for individuals or a 22% rate for corporations. Crucially, any tax already withheld, collected, or paid in this non-final category can be credited in the Annual SPT. For instance, if NGG store, with a turnover of Rp 6 billion, pays 22% corporate PPh from its profit (including PPh Article 23, 25, etc.), the amount already paid can be used as a tax credit to reduce other outstanding taxes. If the PPh due for the tax year is Rp 300 million, and the tax credit from PPh 23 withholding is Rp 65 million, then only Rp 235 million would need to be paid.
How E-commerce Tax is Calculated
The Ministry of Finance provides illustrative examples to clarify the application of the e-commerce tax. Consider WY, an individual online merchant, who sells a computer for Rp 8 million on September 2, 2025. The delivery is handled by PT FQ for Rp 150 thousand, and insurance by PT YS costs Rp 50 thousand. WY has already submitted the necessary information, including an NPWP/NIK, correspondence address, and a statement confirming that their gross turnover for the current tax year is up to Rp 500 million. In this scenario, the Ministry of Finance will not levy the 0.5% e-commerce tax on WY’s computer sale of Rp 8 million, thanks to the submitted statement.
However, the Ministry of Finance will apply the 0.5% tax to the shipping services from PT FQ (Rp 150 thousand) and the insurance from PT YS (Rp 50 thousand). This amounts to Rp 750 (0.5% of Rp 150 thousand) and Rp 250 (0.5% of Rp 50 thousand) respectively, totaling Rp 1,000. The e-commerce platform is responsible for collecting this 0.5% PPh from the shipping and insurance companies.
The situation changes if WY’s income eventually exceeds Rp 500 million, for example, on September 20, 2025. In this case, WY must submit a new statement to the e-commerce platform indicating that their sales have surpassed the Rp 500 million threshold, thus nullifying the tax exemption. The tax calculation would then apply to sales from October 2025 onwards. For instance, if WY sells a printer for Rp 3 million on October 7, a 0.5% PPh, or Rp 15 thousand, would be levied. If WY uses a store courier, that service fee would also be subject to the 0.5% PPh. Notably, if WY sells phone credit (pulsa) for Rp 200 thousand on October 11, this sale would not be subject to the 0.5% PPh, as phone credit is exempt from this particular tax.
Another example involves NLG, an online merchant who submits an NPWP/NIK and correspondence address but fails to provide a statement confirming that their gross turnover for the current tax year is up to Rp 500 million. Consequently, even if NLG sells a bag for Rp 300 thousand, a 0.5% PPh would still be applied due to the missing documentation.
Summary
The implementation of the e-commerce tax, initially slated for February 2026, has been postponed by the Ministry of Finance until the national economy achieves a 6% growth rate. This policy, which imposes a 0.5% Income Tax Article 22 (PPh 22) on domestic merchants’ gross turnover, is still undergoing review by the Directorate General of Taxes. E-commerce platforms are prepared to support it, contingent on clear and consistent regulations, especially regarding technical details in PMK 37 and Perdirjen 15 of 2025. Marketplaces, designated as tax collectors, will only commence collection upon further ministerial directives.
The e-commerce tax primarily targets domestic merchants, encompassing individuals and business entities, with a 0.5% rate applied to sales. Individual domestic merchants with gross turnover exceeding Rp 500 million and all domestic business entities are subject to this levy. Those individuals with turnover below Rp 500 million are exempt from the 0.5% tax on product sales if they submit a valid exemption statement. The collected PPh 22 can be classified as final or non-final, determining its treatment in annual tax returns.
